Can Cable Stick One on Chromecast?

In direct contrast to the much-maligned set-tops rented from cable providers, Google's retail Chromecast device -- a low-cost HDMI adapter that streams over-the-top video content to a TV set -- is owned and beloved by many.

There's a long list of reasons why the two device categories are very different, but the sheer popularity of the Chromecast adapter leads to an inevitable question: Should the cable industry follow Google's lead and develop its own HDMI streaming stick solution?

As it turns out, the answer is not simple.

Traditional set-top vendors are exploring the merits of HDMI adapters and the business-case scenarios that could make sense to service providers. Pace plc chief technologist Darren Fawcett told us about three possible use cases for a streaming stick. First, it could be used for mirroring content from a mobile device to a TV. Second, it could connect to a broadband gateway and offer over-the-top video service direct to a TV. Third, it could be used in a hybrid scenario, combining pay TV and broadcast TV programming with OTT video.

There are pros and cons to the hybrid use case. On the pro side, even though it still represents a capex cost for the operator, a streaming stick could be much cheaper than a set-top. And it still gives service providers a way to manage the video experience without relying on a consumer electronics manufacturer to provide the underlying software.

"I think the reason why the stick is appealing to many operators is because, whilst it is a capex client to handle… [it] enables me to maintain the managed service [and] is also controllable in the sense that I know what software version is on it, and I therefore know… what services I can offer and how I can upgrade my services accordingly," Fawcett said.

An HDMI adapter can also be self-installed by a subscriber (no truck roll). Thanks to Google (Nasdaq: GOOG), it has the cachet of a must-have gadget, rather than a must-tolerate cable box.

On the con side, consumer expectations for cable TV are much higher than they are for the over-the-top video that Chromecast supports. Further, operators want the ability to offer an experience that's consistent with what they deliver on other platforms. In short, the performance requirements for cable providers are much different than they are for Google, and that impacts the size and price of the hardware they need.

"You've got to be mindful that, as soon as you start putting… more into it, in effect it becomes a set-top box," Fawcett said. "It's not quite as straightforward as 'The technology is evolving and therefore shrinking. I can fit it all in the dongle.' What we're seeing is technology is evolving, but also requirements are creeping up."

Re: Performance is key MikeP688: "Creating different classes of users, though, is against the very spirit of the interent that was supposed to be the great equalizer."

Not at all. ISPs have always been able to charge more for more bandwidth. The problem arises when ISPs begin to discriminate against certain websites and businesses with no technical reason for doing so

Re: Performance is key Creating different classes of users, though, is against the very spirit of the interent that was supposed to be the great equalizer. TELCO's already have tiered plans which we've deliberated here. The moves, though, are worrisome to say the least.

Re: "For Chromecast app developers there needs to be an incentive..." This discussion makes me wonder if Google will alloy some kind of "in-app purchases" via the Chromecast interface in the future. That would provide an incentive for some app developers. I also wonder if Google will someday allow Chromecast accessories to be made by 3rd parties (like Apple does with various approved iPad accessories) -- so we might see remote controls or "joysticks" to go along with the Chromecast.

Re: "For Chromecast app developers there needs to be an incentive..." Yes, it is popular--but there needs to the incentive for the App Developers to drive revenue--and as I said, I am more than confident Google will drive it as it dominates ever more.

"For Chromecast app developers there needs to be an incentive..." The incentive for app developers is that the ChromeCast is popular so has sold in large numbers and is easy to use and has an SDK available, allowing them to write support for it into their existing app.

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